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What health reform means for the people of Illinois

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Tuesday, July 25, 2017

The Myth of Expansion and Wait Lists

Pence; Cruz; people waiting for services.
When you're trying to get your bill passed, it makes all the difference to make sure you have a "common sense" message that stresses that, without the bill, a certain horrible thing is bound to occur.

Such is the case for those leaders saying that Medicaid expansion funds are being spent at the expense of the people with disabilities on wait lists for Medicaid services.

"Obamacare has put far too many able-bodied adults on the Medicaid rolls, leaving many disabled and vulnerable Americans at the back of the line." said Vice President Mike Pence at the National Governor’s Association meeting, adding “It’s true, and it’s heartbreaking,” The same argument was made by Sen. Ted Cruz earlier this year.

As with many a faulty argument, its simplicity makes it sound valid. But if you know how Medicaid works, it's a lot like saying "red is a color, and blue is a color, so red is blue." (We wish!)

It’s true that there are Medicaid wait lists for people with disabilities.

And it's true that states have expanded Medicaid.

But there's no connection between funds spent to cover the new Medicaid expansion group and the wait lists experienced by people who were already previously eligible for Medicaid.

Wait lists exist for certain programs due to how those programs were initially constructed. In Illinois, Medicaid began covering services for adults with developmental disabilities in the late 1990s; children were covered in 2007. Both programs were created using Medicaid waivers which, by their very nature, allow states to limit enrollments based on a variety of factors – mostly they do it to keep costs down and better track program performance. Illinois’ waivers were created with wait lists in place years before the ACA became law.

The Kaiser Family Foundation did a comprehensive analysis of this very issue, looking at the impact of Medicaid expansion on state wait lists for home and community-based services. You know what they found? In 2015, the first year of expansion, more non-expansion states had increases in their wait lists than expansion states. And the rate of increase in wait lists was 2.5 times higher in non-expansion.

So, contrary to the "common sense" argument, the exact opposite is true: States that failed to expand their Medicaid programs saw less federal funding enter their state budgets, and thus had to bear a greater share of their Medicaid costs – leading to service reductions, cuts to provider payments, and limits on the types and amount of care provided and, yes, longer wait lists.

The threat to home and community-based services – and other Medicaid programs – is not Medicaid expansion. It is the proposed cuts to Medicaid that will undo all the health care gains, vital programs, and economic benefits brought about by 50 years of state-federal partnership in Medicaid, and enhanced by the Affordable Care Act.